Mobile Marketing Platforms: What Works and What Doesn't Work

You’ve probably read a lot of articles about mobile websites, mobile apps, QR codes and other mobile platforms. But you probably haven’t seen anything that lays out what works in mobile and what doesn’t.

Until now.

What follows is an overview of the most important platforms in mobile marketing as well as which of these platforms work and which of these platforms don’t work. I’ve geared this post for the typical marketing executive or business owner who understands the power of mobile but is still trying to figure out how to leverage it for his or her business.

First, a few definitions. Here’s a list of the mobile marketing platforms you’ll need to be familiar with moving ahead. (These definitions are based on a recent document I wrote for the Mobile Marketing Association.)

Mobile websites: This is a simplified and streamlined version of your desktop website that’s been designed to appeal to a mobile visitor who is using their smartphone or a tablet to connect with your brand.

Mobile apps: These mini-software programs reside within the smartphone or tablet and can be used by brands to provide information or sell products to users. Don’t confuse mobile apps with mobile websites — although they can behave in a similar fashion, mobile websites reside in the cloud and mobile apps reside on your smartphone or tablet.

Mobile display (banner) ads: Display ads can link to a mobile website, a mobile landing page, a text message, a mobile coupon, a video, an audio ad or any number of other digital methods used to drive engagement and revenue.

2D (QR) codes: There are a number of different kinds of 2D codes, the most common of which are QR codes, Microsoft TAGs, ScanLife, SPARQCodes and others. Research indicates that 50% of smartphone users have scanned QR codes and 18% have made a purchase as a result.

Mobile Paid Search: Similar to desktop paid search except for the fact that it’s customized for mobile. The largest and best-known players in this field are Google, Yahoo! and Bing.

SMS and MMS: Short Message Service (SMS) and Multimedia Message Service (MMS) are systems that enable brands to send texts or rich media (graphics, video, audio) to customers.

Location-Based Marketing (LBM): There are two sub-categories of LBM which include Location-Based Services like foursquare, SCVNGR and WHERE as well as Location-Based Advertising which uses mobile display ads to geo-target prospects within a certain location.

Near Field Communications (NFC): Similar to BlueTooth, NFC uses a small chip embedded in a phone to connect wirelessly to another chip embedded in a kiosk, point-of-purchase poster, debit card terminal or turnstile.

Okay, now for the big question. Which of these mobile marketing platforms work and which of these mobile marketing platforms don’t work?

According to eMarketer, less than 2% of all U.S. marketing spending goes towards mobile advertising. (Other data, provided by the Mobile Marketing Association, indicates that even less — about 0.9% — goes towards mobile.) This is surprising, given the fact that smartphone and tablet users spend about 10% of their digital time using mobile devices.

The good news is that the cost of running a mobile marketing campaign is still relatively low. Rates vary widely, but according to Opera Software ASA, on average it costs $2.85 to reach 1,000 iPhone users with a mobile ad. An ad in a national newspaper can cost as much as $50 to $100 to reach 1,000 readers.

The bottom line is that from a cost point-of-view, there are plenty of deals to be had in mobile marketing. The next logical question, of course, is which mobile marketing platforms are going to give you the best ROI?

Let’s take a look.

Mobile Paid Search. According to The Wall Street Journal, “mobile marketers are plowing the biggest chunk of spending into search ads, where it’s easy to prove a person visited a website or bought a product in response to an ad.”

The article goes on to say that half of all U.S. mobile ad spending goes towards search ads and that Google gets 95% of that. (Yes, 95%. Sorry, Yahoo! and Bing.) Even though mobile search is a relative steal right now, in some categories such as hotels, restaurants and auto insurance, bids for keywords can sometimes be higher on mobile than they are on desktop.

Why would that be the case for hotels, restaurants and auto insurance? Because people do searches for those products when they’re mobile. In other words, someone looking for a hotel, a restaurant or an auto insurance company is more often than not doing their search for those products while they’re out-and-about. (Hopefully, they’re doing their search for the auto insurance company before they’ve had a wreck.)

One other note about paid search — some companies report a much higher engagement rate with mobile paid search than with desktop paid search. Comcast reports that the click-through rate (CTR) on their mobile paid search ads is 4 times greater than their CTR on desktop ads.

Mobile Display (Banner) Ads. Banner ads account for nearly $2 of every $10 spent on U.S. mobile ads, which is one indicator that many mainstream marketers find them very effective.

Mobile display ads don’t always click through to a static landing page. Instead, they can lead to any number of engaging outcomes. The following list of banner ad experiences are based on the mobile marketing guide I wrote for the Mobile Marketing Association mentioned previously:

Expandable Ads:When a user clicks on an expandable ad, the ad expands to cover the entire phone screen. Ads can be animated or can incorporate rich media (e.g., video, audio, animation) to enhance the user experience.

Click-to-Download App:Companies interested in driving adoption of a branded app can use display ads to link directly to the app located in an app store. Users are driven to app landing pages where they can download the app instantly.

Click-to-Call: This technique simply displays a phone number that users can click to be connected directly to a call center or sales center.

Click-to-Map: Once the prospect clicks on an ad, he or she can be driven through to a map that identifies a store nearest his or her current location. When the prospect clicks on the map, the contact information is displayed on the smartphone.

Click-to-Email: When a user clicks on a display ad an email is displayed that the user can send to friends. The email includes a discount code that can be redeemed at the retail location. By including this “viral” email component in the campaign, marketers can increase the reach and frequency of the display ad program.

Click-to-Video: Rich media is an effective sales tool, whether it’s viewed on a tablet or a smartphone. Display ads that link to video marketing messages increase engagement and deepen the relationship with the customer prospect.

Click-to-Social: If you’re interested in integrating a social component to your mobile campaign, you can incorporate a click-to-social aspect to it. Visitors can let friends and others know about their affinity to your brand by connecting them to your social networks via a mobile display ad.

According to research conducted by Marin Software, the average CTR for a banner ad on a desktop is 2.39%. For a smartphone the CTR is 4.12%, and for a tablet computer the CTR is 3.12%. What does that add up to? In most cases, it adds up to a positive ROI — especially if you incorporate rich media (audio, video, animation) into the ad.

Mobile Apps: Unfortunately, if you think you’re going to make a million dollars on your next mobile app startup idea, think again. Mobile apps are best for brands with a built-in user base. That doesn’t mean that there won’t be the occasional mobile app idea that doesn’t break through (can anyone say Instagram?), but it is to say that the odds of retiring on your mobile app startup are pretty slim.

All that said, mobile apps can be terrific for brands that have an existing customer base. For a case in point, just look at what Domino’s Pizza or Starbucks have done with their apps. They developed apps designed to deepen their relationship with customers and, in the process, reduce customer churn. (To find out more about the Domino’s and Starbucks apps, read “14 Mobile Marketing Techniques You Can Steal from the Fortune 500” on the 60 Second Marketer blog.)

QR Codes: Okay, first some news about QR codes that will surprise some of you and not surprise others — QR codes will be dead and gone within 2 to 3 years. They’ll be replaced by better options such as Google Goggles or Near Field Communications.

In the meantime, they’re still an effective platform. In fact, research conducted by CMBInfo.com indicates that 50% of smartphone users have scanned QR codes and 18% have made a purchase as a result.

Real Estate Agents are using 2D codes to provide drive-by visitors access to videos that show the inside of homes and buildings. That way, interested parties can see the interior without having to wait to set up an appointment.

BestBuy has added 2D codes to their in-store fact tags to let consumers see information about their products. Customers can also save the information to review at home later or to buy the product instantly via smartphone and have it delivered to their homes later.

Delta and other airlines use 2D codes in conjunction with their mobile apps. Users receive their boarding pass via the app and use the 2D code on the boarding pass to check-in at the airport.

Trade Shows, Events and Conferencesare using 2D codes on name tags. That way, participants can scan the codes and download the person’s contact information instantly. No more business card swapping.

Esquire Magazine used 2D codes to give readers more information about fashion items featured in their magazine. Users can link to the designer’s website to place an order for a product they saw in the magazine.

The Good Cook on BBC1 in the U.K. provides 2D codes so viewers can see all the ingredients and the method of cooking that the chef uses.

Hotels provide 2D codes in rooms to highlight local attractions with coupons to theme parks and restaurants.

The U.S. Department of Transportation and the Environmental Protection Agency are proposing 2D code fuel economy labels on the window of every new vehicle in dealer showrooms.

The New York Times Magazine put a 2D code made entirely of balloons on the cover of their magazine. Users who scanned the 2D code were driven to a special mobile web page promoting their 10th Annual Year in Ideas issue.

Bosch VitaFresh refrigerators in Germany placed over-sized, wrapped packages of meat purportedly from dinosaurs, mammoths and saber-toothed tigers in supermarket freezers. The 2D codes on the packages linked to product information about their refrigerators, resulting in over 75,000 views from customers in stores.

A bank in Ireland provided maps of the Emerald Isle to customers. The map referenced a list of restaurants from across the country. Each restaurant had a 2D code that drove people through a Google map of the restaurant’s location.

Bigmouthmedia in Edinburgh, Scotland includes a 2D code on their Google map location, thereby giving people searching for them with a regular computer access to their website via mobile, too.

SMS isn’t the Bright, Shiny, New Object, but it Still Works. There are other mobile marketing platforms out there that get more attention than SMS, but that’s not to say it isn’t an effective tool. In fact, just about every Fortune 500 company still uses SMS to engage customers and grow their business.

Text-2-Join: This is perfect for non-profits, trade organizations, big brands (like Coke or The Home Depot) and just about any organization that wants to stay connected to its customers. Just encourage people to text their request to join a club, charity or other entity linked to a brand.

Text-4-Info: These are keywords that reply automatically without a need for opt-in confirmation. For example, you could provide directions to different events at a trade show by using Text-4-Info.

Text-2-Vote: Poll questions that ask users to respond to A, B, C or D. This is a great tool for B2C as well as for B2B. If you’re giving a presentation at a trade show, just ask people in the audience to text their vote — t’s a great way to keep them engaged.

Text-4-Survey: This is more in-depth than Text-2-Vote. Best of all, this approach can change the poll questions based on the user’s previous answers. It’s perfect to get in-depth, segmented responses to surveys.

Text-2-Win: A system that replies with “winner” and “loser” notifications based on odds of winning.

Text-2-Give: The American Red Cross did a wonderful job with their Haiti campaign by allowing people to add $10 donations onto their phone bill by simply texting HAITI to a specific short code.

Auto-Campaigns: These are timed messages that follow a subscriber’s opt-in request for information. So, for example, they get a message immediately after opting-in, then every 15 days after their initial opt-in.

Targeted Messaging: This approach lets you schedule a campaign message to “ALL,” “GROUPS,” or “INDIVIDUALS.” It’s perfect for marketers who want to segment their campaigns.

Personalization Tokens: This gives you the ability to personalize a message based on the person’s name, email address, location, etc.

Alias Keywords: Create and “catch” alternate spellings and phrases and link that to the actual keyword.

Location-Aware SMS: Create geo-fences and deliver custom message flows based on a subscriber’s location. Geo-fences can target people within a certain radius of your store, or people in a certain neighborhood.

Facebook Tabs: These are custom tabs installed on Facebook pages that collect profiles and opt-ins.

Now for the Big Question: What Doesn’t Work in Mobile Marketing? It’d be nice if my section on what doesn’t work in mobile marketing were as long as my section on what does work, but the nature of a platform that doesn’t work is that it gets put into the graveyard and we don’t talk about it much.

That said, there are several things you should keep in mind when developing your next mobile marketing campaign.

Don’t use SMS to SPAM: Almost all SMS providers I’ve come across are legitimate entities, but occasionally you’ll hear about an SMS provider who has some secret sauce that bypasses the double opt-in rules that legitimate providers use. If you’re approached by any company that has found a way to bypass these rules, stay away. Your brand is worth much more than any gains you’ll make by spamming unsuspecting prospects.

Don’t Send QR Code Visitors to a Bad Landing Page: If you’re going to ask someone to take the trouble to scan your QR code, the least you can do is reward them when they get there. Some companies are still using QR codes to drive people to their home page which is a waste of everybody’s time. Instead, use a QR code to drive people to a page where they can get a discount coupon, see a map of your location or enter a promotion. (For more on QR codes, read “How to Generate a QR Code Right Now” on the 60 Second Marketer blog.)

Don’t Ignore the New Platforms as they Come Online. There are several mobile marketing techniques coming online right now that will take the world by storm over the next few years. The first is hyper-local, which is the process of using geo-locational technology to make the ads people read even more relevant. Another is behavioral targeting, which is the technique of serving up ads based on a visitor’s previous mobile behavior. And another is location-based marketing which is already being used in the form of Yelp, foursquare and SCVNGR, but will become even more mainstream in the years to come. The key here is to not ignore these new tools as they come online. By diving in early, you can differentiate your brand and stand out from the crowd.

We’ve covered a lot of ground in this post, so feel free to print it out or forward it to others. Better still, sign up for our e-newsletter where we share information like this several times a week.

Oh, one other thing. Feel free to add your feedback and experiences in the comments section below. It’s always great to hear from the 60 Second Marketer community and to see what their mobile marketing experiences have led to.

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